How Much Does Car Insurance Cost?

8 Ekim 2018 Pazartesi

Average Car Insurance Cost

 Factors That Affect the Cost of Car Insurance

 How to Save on Car Insurance

The average cost of car insurance isn’t an easy statistic to find. The answer depends on a number of factors, from your age to where you live to your driving history. For example, if you are 16 years old and getting insurance on your own, car insurance will cost a whopping $8,226 a year. But at age 45, you’ll pay just $1,929 per year for the same insurance. According to a 2014 study by Quadrant Information Service, the annual average car insurance cost in the United States is about $900 per year.

 Where you live also has a big impact on how much you pay for car insurance. As reported by Value Penguin in 2018, West Virginians paid an average annual car insurance of $2,518. In Virginia, drivers paid just $1,114 per year. Overall, Americans paid an average of $900 per year for insurance. So how exactly is car insurance calculated—and how can you save money on car insurance?

 Average Car Insurance Cost Factors That Affect the Cost of Car Insurance How to Save on Car Insurance Average Car Insurance Cost According to car insurance giant Progressive, the average cost of car insurance varies widely across the country. In the report by Progressive, we can see the average car insurance rate by state. The research broke down states into three categories: low cost, medium cost, and high cost. Low Cost States The low cost states include Idaho, Indiana, Iowa, Kansas, Maine, Minnesota, Montana, New Hampshire, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, South Dakota, Vermont, Wisconsin, and Wyoming. With an average monthly premium price of $137, drivers in these states get cheaper car insurance given their location (away from the coasts) and better weather. These states also tend to have fewer people, which leads to fewer accidents, low crime rates, and less dangerous intersections.

Finally, insurance requirements in these states are minimal, which means that insurance companies can offer lower-cost options. Medium Cost States The medium cost states include Alaska, Arizona, Alabama, Arkansas, Hawaii, Illinois, Kentucky, Mississippi, Missouri, Nebraska, Nevada, Oregon, Tennessee, Utah, Virginia, Washington, and West Virginia. In these states, the average monthly premium is $167, due to slightly less favorable weather, higher levels of population, and more crime and dangerous intersections than in the low cost states. In addition, the insurance requirements are higher in these states. High Cost States Finally, the high cost states include California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Louisiana, Maryland, Massachusetts, Michigan, Pennsylvania, New Jersey, New York, Rhode Island, South Carolina, and Texas. Here, the monthly premium averages $232, which takes into consideration severe weather issues, dense population, higher crime rates, and more dangerous intersections. In addition, these states have stricter insurance requirements, which require higher premiums. Factors that Affect the Cost of Car Insurance There are a number of factors that impact the average cost of car insurance for each driver. Insurance companies use statistics to determine the risk posed by each driver—and then use that risk level to set premium prices.

 Demographics First, insurance companies look to your demographics, which include your age, sex, marital status, and location. Essentially, if you are younger, unmarried, and male, you are more likely to engage in risky driving behaviors and file a claim than you are if you are older, female, and/or married. Similarly, location plays a big role in your car insurance rates. People living in states with higher levels of personal injury protection will have more expensive car insurance premiums, as will people living in locations that are more densely populated or that have more cars. The Car You Drive Second, the car you drive will affect your insurance rate. Essentially, if you drive a “safe family car,” such as a sedan or a minivan, you are more likely to get a discount on your insurance than if you buy a sports car. You can also get a discount on your insurance by buying a used car and by making sure that your car has safety devices like alarms and anti-lock brakes. Driving History Third, your driving history has a major impact on your insurance premiums. This one is simple: if you have a record of traffic violations and/or accidents, it will make your rates soar. Work on clearing up your record to reduce your rates.

 Credit History Fourth, your credit history can impact your insurance premiums. Insurance companies view people with poor credit as bad driving risks, because statistics show that the higher your credit score, the less likely you are to file a claim. By improving your credit health, you may be able to get lower premiums. Driving Habits Fifth, your driving habits can also play a role in your car insurance costs. Essentially, the amount that you drive and how you drive will impact your insurance. If you commute into a city every day, your insurance will cost more than it would if you took public transportation or worked from home.

 Coverage and Deductible Sixth, the level of coverage that you have and your deductible will affect your premiums. The higher your coverage limits, the more expensive your insurance will be. While you can reduce your premium costs by requesting a high deductible, remember that this will require you to pay more out of pocket if you have an accident. Additional Coverage Seventh, the type of car insurance that you have will impact its cost. While you are likely required to have certain coverage by law, you may not need other types of coverage. Carefully evaluate your policy to make sure that each type of insurance coverage is necessary before signing a policy.

 >> Read More: Comprehensive vs. Collision Car Insurance Coverage How to Save on Car Insurance Saving on car insurance can be difficult, given that many of the factors discussed above—like your age, gender, and marital status—cannot be changed, or at least not right away. However, there are steps that you can take to save on your insurance. The most important thing to do is to compare the best car insurance companies. Get a number of quotes before buying car insurance using online tools.

That will help you be sure that you are getting the best rate. Next, do your best to lower costs in other ways: maintain a good credit history and do what you can to clean up your driving history. This may mean taking a defensive driving course, which could earn you a discount from your insurance company. You may also be able to bundle your homeowner’s or renter’s insurance through the same company to get a better deal or take advantage of other discounts. You can even reduce optional insurance on older vehicles to increase your cost savings.

 There are numerous factors that go into the cost of car insurance, from where you live to who you are to how you drive. While not all of these factors are within your control, there are measures that you can take to reduce your car insurance costs immediately, such as comparison shopping, bundling your insurance, or getting discounts from your insurer. By using these tactics, you can make car insurance more affordable—no matter what your situation is.

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How to find the best mortgage rate in 2018

19 Mayıs 2018 Cumartesi

It is an admitted fact, that checking the rate different banks offer is not the only thing customers consider before approaching a lender to borrow money. There are certainly other factors such as choosing the lowest available rate, an important thing to think about before having a final thought about the one to whom we are going to approach for a loan.
Comparing mortgage rates of different States?

Let me give you a quote an example of a home loan in Los Angles, California. If you are planning to take a loan, please check for the rate of interest you have to pay to get a loan. If you log onto aimloan.com, a direct internet lender,  input all the required information to get a quote. Let me quote my example. I needed cash of $2,00,000 to purchase a property. I have a credit score is 740+ and it is a 30 year fixed interest rate loan. You would also have to select the option, place of residence. Now, let us see how much ROI it will show for the state of Kentucky? It will show an average of 3.4 as the rate of interest. On the other hand, for a 30-year loan with a fluctuating rate of interest is even lower. It is only 2.8 on an average.

It is worthwhile to note that the rate of interest was 4.3 % during the year 2014 and had a steep fall to 3.9% the same year. Now, it is around 3.8 at the end of 2016 for the same 30-year-old loan.  If you are also planning to take a loan, this is the correct time to go ahead with your plan.
What are the ways to find out a  better rate of interest?
1) Compare ROI of different banks.
2)  Boost up your credit score.
3) Increase the amount you pay as initial payment.
4) Think about how long you want to live in that house.

Let us now understand it a little better.
1. Compare ROI of different banks:  It is quite natural for anyone to approach a mortgage broker to finalize a deal with a bank that gives loan at the best rate of interest. He would advise you to approach a bank with whom he is associated with or the banker with whom he is able to earn the best. Take input from that. But, don't forget to compare the banks before finalizing any plan.

2. Boost up your credit score: Before searching for a bank that will provide you the best rate of interest, try to improve your credit score. It is a matter of simple understanding that the better your credit score is, the bigger your loan amount will be. The banks extend loans to those they consider is safe to deal with.

3. Increase the amount you pay as initial payment:  Try to save as much as you can for making a down payment. If you pay a bigger amount as down payment, you would be able to get a loan that charges a lower rate of interest. In turn, it will fetch you a mortgage insurance policy with a low rate of interest.

4. Think about how long you will live in the house: If you are going to live in the new house for a relatively short period, consider opting for an adjustable rate loan. This is because initially, they charge only a low rate of interest. When it starts to increase, sell it.
These are the ways to find out the best mortgage rate in 2018.

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8 ways to get the cheapest car insurance possible

It is true that we never know when we will get our car stolen or we meet with an accident. It is possible that the misfortune is, even now, waiting to attack you and make you its victim. It is a hard truth that we all want a good insurance policy to secure our vehicle and we are still confused as to which one we want. When you own a car, it is quite natural that you will be flocked by many insurers, who offer, if not the same, similar kind of products and services to allure you.  This makes you so confused that every product appears to be cheap and effective for you. But, don't worry, here is a list to help you ensure that you have made an excellent choice.

1. Don't form a good opinion on a particular company: When you do a research on which company is the best and offers the most number of offers at the least price, never believe in the advertisement. These companies will show attractive commercials to win the trust of the customers. The real truth is that different people will pay different prices as a premium to the same company. Suppose if, Mr. X pays 300 dollars as a monthly premium, it is not necessary that Mr. Y also pays the same. He may pay only $250 or $350 depending upon the physical conditions of Mr. Y. No one company can claim to charge the lowest premium for the same policy.
This charge will further increase if the predictive models indicated that you are likely to go to some other insurers in the future. Price optimization, that is what these insurers call this model, is stopped in, at least, some of the American states.

2. National Vs. Local Insurers: It is quite true that the American insurance industry is dominated by four among all players. They are Geico, Progressive, All State and State farm.  Even though, these national players have won the trust of the customers, we can't ignore the presence of local players like Erie insurance company and Auto owners insurance has earned a name of their own in the minds of customers even better than the national players.

3. Ask for discounts, if any: Whenever you have finalized the name of the company you are going to approach for an insurance policy, check whether any discount is available for you. They will offer you a discount if:
a) You are thinking of clubbing your auto insurance with home insurance.
b) If you are taking two different policies for two of your cars.
c) If you have not had any single accident during the last year.
d) If you are ready to make a single payment of your premiums.

4. Pay bills on time: The only one way to improve your credit score is to pay bills on time and reduce your credit limit a little. This will help to improve your credit score that will reduce the premium you are going to pay the insurers.

5. Choose a car, according to the insurance cost: Whenever, you finalize on purchasing a particular type of car, think about the insurance cost the companies charge for a particular model. If you own a  Toyota RAV 4 you will have to pay more as premium than if you own a Honda CRV.

6.  Don't go for additional covers: Don't think of buying comprehensive or collision covers because if your car is new, it perfectly makes sense. On the contrary, if yours is an old car, it is going to be a waste, because the insurance company pays only the market value of the car if something undesirable happens naturally or because of a third party.

7. Increase the deductibles:  If you increase your deductibles, you can lower your premium. The deductible is the money you pay up front to the insurer, before getting any claim from the company.

8. Mileage-based insurance policy: If you are not a person who drives frequently, then take a policy that allows the insurance company to watch your driving, it will reduce the premium.
These are the 8 ways to get the cheapest policies possible.

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EMPLOYEES STATE INSURANCE

28 Haziran 2015 Pazar

The Employees� State insurance Act came into a  force in 1948, laying  the foundations  for a nationwide  comprehensive  social insurance program  the first of its kind in South East Asia. The scheme covers an integrated  system of social insurance wherein  the benefits include  cash payments  in the event of sickness, maternity, employments  injury benefits and pension  to the dependants, and medical  benefits  to the workers and their families  . From January 1997, an employees  is required  to contribute 4.75% of the payable and the employee 1.75% of the receivable  as the Employee�s state insurance Scheme  (ESIS)  contributions . Though offering  a comprehensive  social security scheme to all Indian citizens  from Kashmir to Kanyakumari  may be a far-fetchedc one , the  Government  as the first major step, announced  the launch of a comprehensive social security  scheme, under the Rajiv Gandhi Shramik Kalyan Yojana to  employees covered  under the ESIS. This scheme was put  into  operations  on April 1, 2005, . The scheme offers invalidity arising  out of the non-employees as a result of retrenchment  , closure or permanent members   of the workers will be supported by the Employees  state insurance Corporations (ESIC)  without any burden on the employer or employee.  The scheme provides  an unemployment  dole of fifty per cent of the wage of the unemployed  to receive medical care in the dispensaries  and hospitals of the ESIC. To be eligible  and to get benefits under this scheme , the workers should have contributed for a period of five years before the cessation of employments.  

ENGINEERING INSURANCE:  As the indicates these are policies  designed to cover various risks associated with engineering  applications during various   stages of productions  or constructions  as the case may be. These policies are process-specific. There are different types of plans to meet specific  requirements.  The Contractors.� All risks policy is one that safeguard the interest of  contractors  and principals in respect of civil engineering  projects. This is an all-risk cover and cover can also be extended  for third party and other liabilities. The sum insured under the policy is equal to the estimated  final erected value of the contract  on a full cost basis. In the event of underestimation  due to cost escalation, the insurer applies the doctrine of average to the extent of under -insurance. Another variations  is the Erections all Risks Policy that is concerned with the erection  of electrical plants and installations  including machinery,  equipments  and structures with little or negligible  civil works terms and conditions are similar to the Contractors, �All Risk Policy� . Under the contractors� All Risk Policy�  and Erection All Risk Policy, 

The option  is available for additionally insuring the contractor�s plant and machinery. If the sum insured is within the specified  percentage  of the main contract then the additional cover will be conterminous  with the main contract of insurance . Wherever the sum insured exceeds the specified percentage, the  contract   could be an annual contract, for the contractors  could be using the machinery and equipments in connections   with other works too. the additional cover indemnifies the contractors  against unforeseen  and sudden physical loss or damage to the plant and machinery due to any of the specified  causes like burglary theft, riots, malicious acts, terrorism  fire explosions, storms, accidental damages, faulty  handling etc., 

The various locations where the plant and machinery will be stored should be   declared to the insurer.  The insurance are  also allowed to issue  the contingency policy on a �First Loss Basis� where the contractors  find it difficult  to provide  the value of individual Contractors� Plant and Machinery (CPM) particularly in the case of mega projects. The insurers are allowed  to issue such covers under the �File & Use� procedure subject to adequate reinsurance support.  In the case of the collapse of the New Air Terminal built in Paris at a cost of $ 925 million, as nearly 400 firms were involved  in the constructions  of the terminal, it was expected  that the investigations  team headed by prof. Jean Berthier might find it difficult  to pin down the  responsibility  to any one firm. It was opined that in the event of any fault by a company, the claims have to be met by the police unique chantier, an engineering  insurance policy that covers  the liability  of any firm involved in the constructions of the terminal for a period of ten years from the date of completions  . It is reported that the reinsurance is shared by Swiss Re, Munich Re, General Re, and SCOR Group of France. 

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GIVE LIFE INSURANCE ITS DUE IMPORTANT

22 Haziran 2015 Pazartesi

 For all those who have financial dependents , life insurance is a must. Life  insurance acts as a tool for income  replacement. The idea is to not make the surviving  family members suffer financially  due to the absence of bread earner.  Its do not enough to keep the family maintain their standard  of living life  insurance ensures  much beyond it. There are a financial liabilities  towards, children which one needs to meet., Life  insurance  makes sure such goals are met systematically  and dreams and aspirations of children are not  compromised . In addition if there are housing  and car loans , life  insurance serves  it role in managing  them as well. In simple  terms, life  insurance company, ensures your family  doesn�t  suffer financially and all your  goals  are met for a small price by paying a premium, that your pay to ensure it.   THE PRODUCT  RANGE:  Life  insurance products help in channelizing  your savings  systematically into various assets for generating returns over the  along term. As wealth  gets disciplined  savings are goes a long way in meeting  the long term financial  goals. 

On one  end of the spectrum are the pure the term  insurance plans. They solely  cover the risk of the dying. Nothing is paid  on maturity I.e. on surviving  the policy will replace the income  that will cease  to accrue. Then there are a  traditional  insurance plans including  endowments  and money back plans which are a  ideally suited  for conservative  individuals  looking  to bundle savings with protections . On the far end is

the market linked investments  cum protections plan called until linked  insurance plan ideally suited for a   those looking for a bundling  and exposure  to equities as asset  class for a higher that inflation  kind of returns. Besides protection   insurance, products  with savings elements  helps in meeting one�s  long term goals such as kids  education  marriage  or even retirements . Market linked  insurance products having  equity  exposure  comes handy in this as equities are said to work best over long term as against  other asset classes in delivering  higher than inflation adjusted  returns. Link your savings in these unit linked  insurance plans to long term goals. Be exposed  to equities  till about three years  away from goals  and

then start shifting funds from equity  fund options to less volatile debt funds. This helps in protecting  the gains made. 

LIFE STAGE BUYING: Buying  insurance is not a one time affair.  The  insurance need changes as per life stage and one should provide for each one of them. Reviewing  requirements  at every life stage or after 5 years  helps. For those who are single or have recently  started career, the immediate  need might not be there unless there are a financially dependents  parents or siblings ,. However even for them buying   insurance early in life helps in keeping the premiums  low because of age and medical 9issues  connected  with higher ages. As one move up the life stage., gets married and have children, the  insurance need rises. Keeping and adequate coverage not only helps family maintaining  the same standard of living but also helps in achieving  certain  life goals such as kid�s education or marriage.  Since education is the prime concern for most Indian parents, investing  in a child plan will ensure that the education of your kid goes unhindered  whether or not you are a around. Its is a  very likely  that during this  period, one takes a home loan and adds on the exiting  financial liabilities. Getting  not just the home loan insured  but also any other form of loan such as a car or personal loan is a must.  The value of the human life is unlimited. Still most of us consider  it enough  to keep a life cover of Rs. 2 lakh- Rs. 5 lakhs  or Rs 10 lakh . Will it suffice ? Will such amount be enough to replace one�s  income be enough to replace one�s income  for the next several years? No wonder we at most times are under-insured during  our life time.  GET REAL VALUE OF YOUR LIFE: Human life value (HLV) approach to calculating  the  insurance requirements  takes into a account  four factors annual income, annual expenses  years to retirements and inflation adjusted cost of  expenses. From these  factors a reasonable accurate assessment of the value of your income can be made. First  deduct all your personal expenses  such as a food, clothes, travel, entertainments  from your annual income after deducting personal expenses  is what your family consumes. Second see how many years of earning  are left your retirements  age minus your current age.  Project  family expenses up  to retirements. Add non-recurring expenses , like your children�s  higher  education  or their marriage. The shortfall is  

what you should  insure for. Third calculate  the present value of the shortfall allowing for a reasonable  rate of inflation . You may deduct existing  life coverage and account  for any debt such as a  big ticket  home loan to arrive  at a more reasonable  HLV figure.  CONCLUSION: Link your life  insurance to your goals. Choose between traditional and Ulips based on your requirements and understanding  of the products. Do not invest in any of term unless you have a basic understanding of how these products the  work. Once

 bought  run them will till maturity and refrain  exiting  earlier  as a it would  turn costly  in surrendering

before the term ends.  As a thumb rule, keep life coverage of at least ten times, of your  annual income. Above all, ensure you are a not under insured  as that would be the biggest mistake in your life. ...

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LIFE INSURANCE TERM AND CONDITIONS

4 Haziran 2015 Perşembe

Life insurance in its  nascent  is known term insurance . The every very name implies  that the coverage is for a  limited  and specific  time. A term insurance  contract could be structured  for any period. Generally from the point  of view of underwriting  , the term  varies  from five years  to twenty  years. However Assured Life Time, a  term insurance product of TATA -AIG is a  available  fro a term of one year and has certain attractive  options like conversations  of the plan to a savings plan and renewal  of one and five year plans without  any medical test etc., Under a term insurance  contract, the sum assured  becomes  payable only if death occurs  during the selected  term, and nothing  becomes  payable once the term expires. Wherever  the contract  envisages a  renewal of the contractor  for a stipulated  period after the expiry  of the original contract  such a policy is called Renewable  Term insurance policy. 

Some term insurance  contractors  offer a  conversion  clause by which the assured  can experience  an option of the to convert the term into a  permanent  assurance plan without plan any further medical  examinations  . LIC, Max New York Life Tata AIG are a few examples,.  Until  recently term insurance contractors  were not  popular in India.  The first branded  term insurance plan Bima sandesh with return of premium  provision  had a  slow death for want to of proper positioning , . With the opening up of the industry, the concept of the term assurance plans received a shot in the term arm and many companies  like ICICI prudential  Life, Birla Sun Life, and LIC market such term assurance  plans as a assurances  with Return of premium (ROP).  With the opening  up to the industry to private players, the concept of the �Term� is getting promoted . Now private companies  alongside, LIC, market such plans , and the  price war is hotting up in this product class. For the first time among private insurers in the Indian market , Max NEW YORK LIFE came out the with a  LEVEL  Term Plan with  yearly  and other mode options  with the term extending  to 20 year and 25 years. This was  positioned as an attractive  low-cost plan.  Another innovative term insurance plan was a the KOTAK Preferred  Term PLAN (KPTP), introduced  by Kotak mahindra  Old Mutual Life insurance company. His term assurance with a  minimum sum assured  of  Rs. 10 lakhs is available for men  in the group  of 18-60  years , provided  they do not  tobacco in any form. If some  one  takes  to smoking  the after the conclusion  of the contract  the company may view  it as a violation  of the terms of contract  and decide  to decline the death  claim, it if is  established  that the death has resulted as result of the policy holder taken to the tobacco smoking. 

  Bajaj Allianz  Term Care offers  life insurance  cover at a low cost and provides  for returns  of premiums on maturity. The premium   returned  at a maturity amount the to the sum assured  of the premium paid until  maturity sans the extras, if any . In the event of the death of the assured, the sum promised  is paid to the nominee of the legal heir. The plan has built  in Accidental  death Benefits  and Accidental  permanent Total/ Partial Disability  Benefits subject to conditions . 

This plan is marketed  under economy, protect health the and total compacts  with graded benefits. ING Vysya markets  a term insurance plan with a critical  illness rider and HDFC standard  Life markets a loan protections  cover. Life shield  a term  insurance plan  offered by Aviva  life insurance , LIC�s  Jeevan Anmol, Shield, the term insurance plan  of SBI Life Tata -AIG�s  Life Plus, ICICI Pru�s  Life Guard  are some of the well known term insurance brands. A number of the variations  are offered  under these plans.  Though  a term insurance  plan provides very high protections at a minimum cost, it should be noted that it is only temporary protection  and cannot  offer the type of the security  that a  permanent  insurance cover can. It should  also be noted  that if they  a person aged 30 , considered  the cost advantage  and takes only a term Assurance for a  period  of 30 years and if he/she survives the term on reaching  the elderly  age of 60, he/she is left  high  and dry without any insurance proceeds  to fall back on. Even  in the US, where the dictum buy term and invest the rest was once popular , public outlook is changing in preference to comprehensive plans.

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RURAL LIFE INSURANCE AND PRIVATE SECTOR INITIATIVES

Among  the private sector  insurers, who started  their activities during  2000-2001, aviva life insurance  . Co had launched  an exclusive  plan for  rural  areas called Gram Suraksha. The test marketing  results of the Plan in Andhra  Pradesh  were reportedly encouraging  and the company  hopes to market the plan through institutions. The law priced policy offers life cover and money back benefits . For broad basing  its rural portfolio , Aviva life  had opened  offices  at Faridkot, Nagpur, Nashik and Udaipur, in September 2003, Aviva had also launched  customized  products  called  Amar Suraksha  and Jana Suraksha . 

The term former  is a  term insurance cover the with return of the premium provision  on  survival  of the selected  term., The latter is a  fixed term policy available  for terms  of five years  and ten years  respectively  for the sums assured of Rs. 25,000 or Rs. 50,000  as the case may be. Aviva is confident  of utilized  the extensive rural network of its Indian partner , Dabur.  This was  followed by the launch of the Sankat  harn Policy by IFFCO-tokio , General insurance  Company  for farmers, Gramin Bima Yojana, a plan of Kotak mahindra  Old Mutual insurance co.  Is a plan designed to suit  the needs  of the rural populace. This single  premium endowment  plan provides  for payments  on death or maturity whichever  is earlier  . The plan  has a fixed term of 15 years . 

The policy can be surrendered by at any times  and the surrender at any the time and the surrender value  varies  from 90% tp 230% upon the period by for which  the policy has remained  in the books of the insurer. ICICI Prudential  had also launched  different  types of the  policies like ICICI  Pru Mitra an endowment  type of the plan and ICICI plus Pru Suraksha  a regular premium plan to meet the varying  needs of the rural populace. HDFC Standard  Life markets  certain  specialized life insurance products for the rural market. Development  insurance plan., A group insurance product is being  offered by the HDFC Standard life to the rural markets  through NGO;s  and  Bima Bachat Yojana, is another  product meany by the  rural consumption .

 The Birla  Sun Life , Bimla Kavach Yojana is a single premium insurance policy specially designed  for the rural under privileged. The private insurance companies until the end of the fiscal 2002-2003 could not be make by any perceptible penetration  into the rural areas and as the end of the fiscal  200-03, the combined  rural life insurance coverage  by LIC  and private  players was around 27% leaving   behind a substantial  populations  to be covered.  Both for the public sector and  the private insurance companies, distributing products   in rural areas poses certain problems  . As a  agricultural  income is presently  tax-free in India, in the rural areas tax sops  offer no  attractions  and , as a  such the marketing  is more   individual need -based. Many of the agents for advisors, do not find it profitable  to visit the rural areas or  distributing  limited  products, .

 To overcome this situations, companies  are adopting  new strategies, . Some  companies resort to mass compaigns  by addressing the villagers  with the help of the local village head or the Sarpanch  . Alternatively, some of the companies  tie up  with banks  having  wide  rural networks for distributing  insurance products, through  the Bancassurance  route. Some companies  enter into tie-up with NGO�s and social organizations  facilities. Agencies  to offer product  in the rural  areas. Some of the companies are also drawing are also drawing  on the concept of  Rural Career Agents or Advisors, which has been pioneered by LIC, in spite of difficulties, unlike in the past fiscals,  at the end of the financial  year 2003-04, all life insurers  had completed  their rural and social sector obligations, In the connection  a suggestions,  of Apparao  Machiraju  merits  examinations.....

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SETTLEMENTS OF CLAIMS UNDER MOTOR INSURANCE

16 Mayıs 2015 Cumartesi

 The claims arise under motos insurance are divided  into two classes i.e. claim for own damages  and claims for third liability.  (A) CLAIMS FOR OWN DAMAGES: Own Damages arise which damage to the vehicle  is caused by the insured. These damaged  are generally caused by collision or over running of the vehicle. The settlement of claims for own damage is done in three phases, namely preliminary scrutiny  assessment of loss and settlement.   (a) PRELIMINARY SCRUTINY:  Immediately on occurrences of any accident or loss of or  a damage to the vehicle, the  insured has to serve a notice of a loss of the insurer. On receiving  the notice, the insurer will check his records to find out whether policy is in force or discontinued ..

Later, the loss is entered in claims  register and a claims form is sent to the insured to be filled up by him and to be returned  to the insurer. The insured is asked to give all  relevant   particulars in the claim form such as a date and time of accident cause of accident extent of damage to the vehicle  etc. The insured is also required to submit a detailed  estimate of repairs from any repairer of his choice. The insurer generally accepts the estimates. But at times he  asks for another estimate , Insurer does with this when it doubts the competence  moral hazard or business integrity of repairer first chosen.   (b) ASSESSMENT: The insurer employs independent  automobile surveyors  to ascertain the cause of the accident and extent of loss sustained by the insured.

 The surveyors  are supplied a copy of a the policy , the claim form and repairer�s  estimate. They inspect the damage vehicle, discuss the cost of the repair or replacement with repairer and submit their survey report. In case of minor damage claims independent   surveyors is not appointed. The officials  of insurance company or its engineer inspect  and finalise the claim  report.  ( C ) SETTLEMENT: The surveyors  report is taken as a basis for settlements of claims. The report is examined  thoroughly  and settlements is made according to the recommendations  in the report. The usual practice is to authorize repairer. The repair receives a later from the insurer. The repairer will be given payment after completion  of repairs. The insured has go to give a satisfactions  note or voucher that he is hundred  percent satisfied with the repairs. In case the cost of repair paid by the insured, the latter can recover the amount from the insurer. For reimbursement of cost of the repair the insured has to produce  the letter receive from the repairer  with the insurer as an evidence for payment of cost of repair. Finally the insurer will pay the claim for cost of repair.  

(B)  CLAIMS  FOR THIRD PARTY LIABILITY: The third party liability arises  when a motor vehicle hurts a third party so as to cause damage to his property or his death or a personal  injury  to him. For settlement claims for third party liability the following procedure is generally adopted:  (1) ENTRY OF NOTICE:  As soon as the notice of claim is received  from any: the insured the third party, or the Motor Accidents Claims Tribunal (MACT)  the same will be entered in Claims Register. Date of intimation, claim number , Policy number data of accident. Vehicle number . MACT  number . Name of Insured, Driver and claimant, amount claimed etc are entered in the Claim Register. Separate sections are maintained in the register for fatal claims and bodily injury  claims

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HISTORY OF MOTOR INSURANCE

7 Nisan 2015 Salı

 Motor insurance was first launched  in U. K.. The first car was manufactured  in 1984and the first motor insurance  policy was issued  in 1985. It covered liabilities  to third party. In 1889, accidental damage to car in 1901 burglary and fire were added. Thus the progress made is found is in comprehensive policy of today. In 1903, the car and General Insurance Corporation Ltd. Was started and many companies  were started later. After World war, number  of card and car accidents increased. The victims of the car accidents  were not given any compensations. So the third party insurance was made mandatory (The Road Traffic Act 1930, 1934, and 1969)  (In Motor Vehicles)  Act was enacted  in 1939. The act was the same as that of U. K. The only differences  is that in U. K. tariff is withdrawn, but India�s tariff governs the  insurance.

FUNDAMENTAL PRINCIPALS OF MOTOR INSURANCE

The basic principals  applicable to motor  insurance are the same as they are  in property and liability  insurance. But the applications of these principles  to automobile  insurance is accepted  as a specialised  problem requiring a special contract. However let us recall the principles below in brief: (1) Utmost good faith: Motor  insurance contracts are contracts of utmost good faith . The proposer is liable to disclose all the material facts relating  to the motor vehicle  to insurer. For this purpose the proposer is a given a proposal  from and he is asked to give answers for all the questions asked in it. The answers  given by the proposer  becomes warranties or promises. So the answers  must be true to the language and must  be correct. Any incorrect answer  on any matter will make the contract viodable. Some examples  of material facts are: the type of vehicle, the geographical  area of use, the physical health  of driver the driving history, traffic convictions and post loss experience etc. Many of these provisions are now regulated by motor vehicle Act 1939 

. (2) INSURABLE INTEREST: It refers to legal right to insure. The essentials of insurable interest are: (a) Existence of motor vehicle exposed   to damage or liability : (b) such motor vehicle must be the subject matter of insurance: and ( C ) the insured must be in such a position that he shall suffer by loss or damage or benefit by the safety of the motor vehicle. Generally the following parties are expected to have a

n insurable  interest.  (a)  INSURED: As a owner of vehicle the insured suffers a loss if his vehicle is damaged or from a legal liability to third  party who suffers a loss for his negligence. (B) OTHER THAN INSURED:  The driver of the vehicle may create liability for insured. In effect, the insured becomes the agent for the drivers and insured indemnifies him.  ( C ) FINANCIER: In hire purchase agreement, the financier�s interest is insurable. In case the vehicle  is lost  or damaged, the financier can get compensation.

(d) MOTOR TRADER: The garage proprietors as bailees have insurable interest for customer�s loss or damage.  (3) INDEMNITY: The objects of this principle is to place the insured after a loss in the same financial position as far as possible, as he occupied immediately  before the loss. The effect of this principle is to prevent the insured from making a profit out of his loss or gaining any benefits or advantage. Accordingly  to this principle, the insurer is liable to pay the actual value of loss or sum insured whichever is less in case of total loss to insured. If old parts are replaced by new a suitable depreciation is charged on new parts. Insurer may repair or replace or pay cash as it likes. Liability to third party is limited to policy sum Legal costs are also indemnified. 

  (4) SUBROGATION AND CONTRIBUTION: Subrogation is transfer of rights and remedies of the insured to the insurer who has indemnified the insured  in respect of the loss. It arises only when the third party is responsible for damage. Insurer may exercise the insured�s right to recover damages. Generally they the right arises after payment of damage. Contributions  refers to sharing of damage between co-insurers. It is done in the proportion  the insurer�s share bears to total sum of all insurers

(5) PROXIMATE CAUSE: The insurers are liable to pay  compensations only if loss is caused  by a peril most proximate or the nearest to damage and if it is insured against. It is applicable to third party claims also.

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MISCELLANEOUS INSURANCE

MISCELLANEOUS INSURANCE

Introduction :  Insurance not falling under fire insurance and marine  insurance is considered as miscellaneous  insurance as per the insurance. Act 1938. The four public sector general insurance companies and some private general insurance companies have brought to light a number of miscellaneous insurance policies is cover a variety of other risks. The most important  forms of miscellaneous insurance are: Motor insurance, Legal liability insurance, Business insurance, Hospitalisation insurance, Social sector insurance, Engineering insurance,  Rural insurance,  and other insurance. Let us discuss all these  insurances, one by one in the pages to come

. 1. MOTOR INSURANCE : The owner of a motor vehicle  is exposed to various types of risks. These risks fall into two groups. First those of damage to , or loss or destruction of the motor  vehicle  itself and second, that of being called upon to pay damages for injuries which may be done to others through  the use, ownerships  or maintenance of the motor vehicle. The first

or risk  may further be classified as follows: 

(1) Destruction by  fire, internal or external in origin, 

(2) Theft,

(3) Injury through collision with some other object moving or fixed or through upset.

 (4) Other damages to motor  vehicles as by breakage of glass, damage in flood, or while being transported. The second type of risk  is the liability of the insured to third parties arising out of a accidents caused by the use of a motor vehicle on the road. The liability may be for death  or bodily injury or for damages to property. The risk also vary accordingly  to the class of vehicle. E. g. in a passenger automobile. the liability may be for death  of or injury  to passengers  or in a common carrier, the liability may be loss of or damage to the property carried. In order to safeguard  the owner of a motor vehicle from the above mentioned risks a special insurance,

 has been conceived known as marine insurance

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TYPES OF GROUP INSURANCE POLICIES

The LIC of India has designed some group insurance policies  for the benefit of working class. Such  policies are described  briefly  below.

  (1) Group (Term) Insurance Scheme: It provide  life insurance protection  to group of people. It is offered  under One Year Renewable Group term Assurance (OYRGTA) and  the scheme�s  is renewed  every year after taking in to a account the changes  in the size of group. The following are the main features of this scheme.  (a)  Master policy: A single master policy is issued covering  all the members of the scheme. The scheme is administered by the Employer Associations, Societies, etc. called Nodal agencies, 

(b) Premium : Premium rates are reviewed on the basis  of claim experienced under the individual scheme. ( C ) Eligibility : For all Non-employer employee  group scheme, the basic insurability condition is that the member should be  in good health on the date of entry. For the GI scheme of employer- employee groups the  insurability   condition is that the member should not be absent on  groups of sickness on the entry date.  ( D)  Restrictions: The restriction under this scheme relate to minium and maximum age limit for eligibility of cover (18to 60), participation of minimum percentage (75%)  of eligibility  members  of the  groups at inception  and compulsory participation of all new members.  (E)  Benefits: As the name term insurance indicates the amount cover is payable in the event of death of the member. Nothing is payable on survival. The cover amount  is either uniform or graded. Uniform cover means that every member  of the  groups is insured for the same amount. The cover is decided  on the basis of average size of the  group and occupation or activity  which  group is engaged in. Graded cover  us usually granted to employer / employee  groups because of general level of health care and life style of the member being  satisfactory. For graded cover,  group can be divided  in to who three or four levels such as: 

GROUP INSURANCE SCHEME IN LIEU OF EDLI (EMPLOYEE�S  DEPOSIT LINKED INSURANCE) : All employers to whom the Employee�s . Provident fund and Mis. provision Act 1952 applies  have a statutory liability to provide life insurance benefit to all their  employees by subscribing  to Employees Deposit linked Insurance (EDLI)  1976 i.e, Rs. 0.60 per Rs. 100 wage  bill of each employee. Under EDLI  scheme, in the event of death  balance in PF account  of the deceased Rs. 60, 000, whichever is lower . The Employees P.F and Mis . Provision Act also provides

that if  any scheme of insurance gives more benefits than the EDLI the employer  is entitled to switch over to that scheme after obtaining  the approval of the  Central provident Fund Commissioner.  LIC�s  GroupInsurance  Scheme in lieu of EDLI has been accepted  as a better alternative for EDLI. Under LIC�s  group insurance Scheme. each employee is covered for a sum assured  of more than Rs. 60, 000 depending upon the current salary and services put in from the very first  day, irrespective  of the actual balance in the provident Fun.  ELIGIBILITY:  For LIC�  Group insurance  Scheme in lieu of EDLI  the insurability  condition is that he should be a member  of the Provident Fund�s Scheme  of the employer.  ACCIDENT BENEFIT: Double  accident benefit can be allowed to the extent of the sum assured  for an extra premium @ Rs. 0.75 per thousand. Benefits to Employer: (a) Premium under LIC�s Group insurance scheme is usually less than the total contribution to provident fund  authorities. (b) Settlement of claim is quicker  ( C ) Premium paid is treated as business expense  for income tax purpose.  

 GROUP SAVINGS LINKED INSURANCE (GSLI) scheme: The GSLI scheme offers insurance cover together with a saving element. The GSLI scheme this scheme , is deducted from the monthly salary of the member. The scheme is applied in Govt. Bodiespublic sector corporations and reputed  private companies who  keep accurate records of their employees. A portion of the contribution of the employees is utilised  as premium to cover  term assurances  for a fixed sum and the balance is treated as savings which are accumulated  at an attractive rate. At present, the rate  is 10%  p.a, Member exit the scheme on retirement or earlier by death or resignation. BENEFITS: (a) On death while in service: Amount of insurance cover and accumulated  savings up to  the date of death. (b)

 On retirement / resignation: Accumulated  savings up to the date of exit. TAX BENEFIT: (a)  Contribution Full are treated as insurance premium and enjoy the benefits under section 80C. (b)  Savings accumulations received are tax free.

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GROUP INSURANCE POLICIES

Group insurance policies  are certain plans of insurance which are offered to group of persons. The group may be:

(a) Employer- employee  group, (b) Association  of professional, doctors, etc., ( C ) Members of Co-operative Banks / Credit societies. (d)  Association of weaker sections such as Rickshaw pullers, Railway porters etc., (e) Member  of housing Societies.  (f) Borrowers of housing  loan from public sector undertakings.  (g) Borrowers of Bank  Co-operative Societies or housing societies. Under group insurance a master policy  is issued as evidence of contract between the insurance company and another legal entity which may be an employer, trustee, and an association.

The master policy defines the group of lives to be covered  benefit if confers, the amount of contribution  to be paid and other condition and privileges  of the participating  group member. Group insurance is a group selection process and not a selection of individual life. It is recognised that every group  will contain some proportion of substandard lives but group under writing  assumes that the insurer is able to reasonably  assess the overall risk from the general nature  of the group. The group  is supposed to be homogeneous and contains  sufficient  numbers so that the number of claims to be  homogeneous and contain  sufficient numbers so that the number of  claims by death can be reasonably  estimated on the basis of the average. The amount of cover is determined on the basic of a formulas and is not decided by individual  forming the group. Insurance on the lives of all members up to a limit called �Free cover limit�  is granted  on the basis of simple rules of  insurability �. �Simple rules of insurability   means not absent from duty on group of sickness  on the date of effecting insurance. Free cover limit does not mean free insurance premium. It is free to the extent that no evidence of health is called for .  As a result of ,ass administration and simple underwriting  practice, group insurance becomes  a low cost insurance cover for a group. However the premium rates are adjusted   on the basic of experiences. This is called. Experiences Rating . For medium and big sized group. sharing of profits on the basis of years after taking into amount feature. If surplus is generated over a period of years after  taking into account the premium collected and the benefit conferred the rate of premium can be reduced in the future years. If on the other hand, it results in continuous  is rated up.

Difference between Group Insurance and individual insurance  Group insurance differs from individual  insurance on the following counts.

 (1) Cover: A group of person  is covered under the Group insurance. A person�s life covered in individual insurance. (2) Contract: The Group insurance is contract between the insurer and another legal entity, which may be an employer, trustee and an association. The individual insurance is a contract between the insured and the insurer.

(3) Medical Examination : No medical examination is required for Group insurance. In  Individual  insurance, medical examination is necessary in most of the cases. (4) Policy: A master policy is issued   for Group insurance as against an individual policy  in individual insurance. (5) Sum Assured : A fixed sum assured is paid for every claim under Group insurance. The sum assured depends  upon the premium paying capacityof the assured in individual insurance.

  (6) Premium: The premium under the Group insurance is paid by the employer or employee or by both. The premium under individual insurance is paid either by the assured or by the insuring party.  (7) Protection: The group insurance  is a social welfare scheme. The individual insurance is a provision  for old age and for the family.  (8). Change of Assured: The individual is changed under the Group insurance in case of retirement or death. No such change is possible in individual insurance.

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LIFE INSURANCE PRODUCTS OR POLICIES

As mentioned earlier  in the  life insurance  industry, apart from LIC India Several private companies are also involved  in selling  life policies to general public living in different corners of our country. The policies of private players have already been given in the previous chapter. The policies of LIC of India have great have been grouped under the following nine major  heads.

1) Whole life policies. 2)  Endowment policies  3) Children�s policies 4)  Joint life policy  5) women�s policy 6) Term policies  7) Special policies  8) Group insurance policies  9) Pension policies.   

(1) whole life policies:  

The risk is covered for the entire of the policy holder which is why they are known as whole life policies. They policy amount and the bonus are payable only to the nominee or the beneficiary upon the death of the policy holder. The policy holder is not entitled to any money during his or her own life time i.e., there is no survival benefit. This represents a  serious drawback in the case of whole life policies for they go on covering a policy holder�s life even after his life has no further economic  value for others. One the other hand   a policy holder would probably require  the money for himself  and his spouse during  retired life but this would not be possible since the sum assured is payable  only when the   policy holder dies. In his sense whole life  policy  are fairly  rigid and suitable  only in a few very specific cases. The important  whole life  policies offered by LIC of India are as follows:

 1)  Single  premium whole life plan No.8: Under this  policy  the total  amount of premium payable is paid in one lumpsum by the assured. The time element is the predominating feature and protection element  is substantially less than the face value of the  policy . The  policy  is not so  popular but is purchased for investment  purpose. It suits those persons who get windfall income like lotteries etc. and who can afford such single payment. The minimum sum assured is Rs. 20,000 and there is no limit  maximum sum assured.

(2) Convertible whole life plan No-27:  This  policy  is suitable to young man who is on the thresh hold  of his career and has prospects of increase in income after some times. The object of  this is to provide maximum protection at minimum cost. It is a whole life without profit plan, premiums payable up to age of 70 yearsof the assured. The premium charged is that of whole life without profits  and therefore sufficiently low. This risk is however covered for the full sum assured. After 5 years, the life assured can convert this  policy  into an endowment with or without profits choosing that term without having to go on in for a medical examination In case the conversion option is not exercised at the end of 5 years the  policy continues as a whole life plan without  profits with the premium payments ceasing at the age of 70. The minimum sum assured is Rs. 20 000, and the maximum age at the entry is 45 years.  3) Limited payment whole life plan  No-5: In this  policy the life assured required to pay premium for a fixed period from 5 to 55 years. The life assured shall have

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